Category: Taxation

Pakistan Revenue delivers the latest taxation news, covering income tax, sales tax, and customs duty. Stay updated with insights on tax policies, regulations, and financial developments in Pakistan.

Advance tax on dealers, commission agents

KARACHI: Every market committee has been required to collect advance tax from dealers, commission agents under income tax laws.

The Federal Board of Revenue (FBR) recently updated Income Tax Ordinance, 2001 under which advance tax is collectable from dealers, commission agents and arhatis under Section 236J.

Section 236J: Advance tax on dealers, commission agents and arhatis etc

Sub-Section (1): Every market committee shall collect advance tax from dealers, commission agents or arhatis, etc. at the rates specified in Division XVII of Part-IV of the First Schedule at the time of issuance or renewal of licences.

The rate of collection of tax under section 236J shall be as follows:

Group Amount of tax
(per annum)
Group or Class A: Rs. 10,000
Group or Class B: Rs. 7,500
Group or Class C: Rs. 5,000
Any other category: Rs. 5,000

Sub-Section (2): The advance tax collected under sub-section (1) shall be adjustable.

Sub-Section (4): In this section “market committee” includes any committee or body formed under any provincial or local law made for the purposes of establishing, regulating or organizing agricultural, livestock and other commodity markets.

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March 23, 2019

MCC Appraisement West announces auction of vehicles on March 25

KARACHI: Model Customs Collectorate (MCC) Appraisement (West) Karachi announced auction of vehicles laying at Al-Hamd International Cargo Terminal to be held on March 25, 2019.

Following vehicles will be offered for the auction:

S. No.	Description	Model	Capacity
1	Used Mitsubishi Car	2009	–
2	Used Mitsubishi Mini Cab	2013	–
3	Used Nissan Clipper	2012	–
4	Used Suzuki Stingray Wagon R (without extra goods)	2013	–
5	Used Toyota KX-R V6	2013	3456 ML
6	Used Honda FIT Car	2014	–
7	Used Suzuki Carry	2013	650 CC
8	Used Honda Shuttle Hybrid Car	2015	–
9	Used Honda FIT Hybrid Car	2017	–
10	Used Suzuki Lapin Car (ene-charge)	2017	–
11	Used Lexus NX300H (Hybrid)	2015	2494 ML/CC
12	Old & Used Toyota Mark-II (Grande) Car	2004	2000 CC
13	Old & Used Toyota Mark-II (Grande) Car	2000	2000 CC
14	Old & Used Toyota Mark-X-250G	2005	2500 CC
15	Used Toyota Hilux 4X4 Double Cabin	2009	3000 CC
16	Used Toyota Hilux Double Cabin	2004	2779 ML
17	Old & Used Toyota Hilux 4X4	2009	3000 CC
18	Used Toyota Hiace Van	–	2446 CC
19	Old & Used Toyota Hiace Van Ambulance	1995	2446 CC
20	Old & Used Toyota Hilux Pickup D/ Cabin	2008	2779 CC
21	Old & Used Toyota Hilux Pickup D/ Cabin	2000	2779 CC
22	Old & Used Toyota Hilux Pickup D/ Cabin	2008	2779 CC
23	Old and Used Toyota Vigo	2005	2779 CC
24	Old and Used Toyota Hilux 4X4	2002	2779 CC
25	Old and Used Toyota Hilux 4X4	2002	2779 CC
26	Old & Used Toyota Hilux 4X4	2000	2779 CC
27	Old and Used Toyota Hilux 4X4	2002	2779 CC
28	Old and Used Toyota Hilux 4X4	2002	2779 CC
29	Old and Used Toyota Hilux 4X4	2002	2779 CC
30	Old and Used Toyota Hliux Pickup 4X4	2002	2779 CC
31	Old and Used Toyota Hilux 4X4	2000	2779 CC
32	Old and Used Toyota Hilux 4X4	2000	2779 CC
33	Old and Used Toyota Tsusho 4X4	2000	2779 CC
34	Old and Used Toyota Hliux Pickup 4X4	2002	2779 CC
35	Old and Used Toyota Hliux Pickup 4X4	2002	2779 CC
36	Old and Used Toyota Hliux Pickup 4X4	2002	2779 CC
37	Old and Used Toyota Hliux Pickup 4X4	2002	2779 CC
38	Old and Used Toyota Hliux Pickup 4X4	2000	2779 CC
39	Old & Used Mitsubishi Van	1997	2477 CC
40	Used Volkswagen AG Car	2013	999 CC
41	Used Nissan Dayz Roox	2017	–
42	Used Honda Jade Hybrid Car	2015	–
43	Used Honda N-ONE	2015	–
44	Used Daihatsu Subaru Stella Car	2016	658 CC
45	Used Honda ACTY Van	2017	–
46	Used Suzuki Alto ene-charge Car	2016	–
47	Used Daihatsu Mira E:S Car	2015	658 CC

March 23, 2019

SBP directs banks to ensure OTC tax collection by March 27

KARACHI: State Bank of Pakistan (SBP) on Friday directed all commercial banks to ensure receiving payment of duty and taxes through over the counter (OTC) channel.

The SBP said that the finance department through circular on July 17, 2018 made it mandatory for banks to enable their Over-the-Counter (OTC) Channel for collection of taxes and duties.

Complaints are pouring in from different quarters, regarding non-entertaining of tax payment requests through banks’ OTC Channel.

So much so that Federal Board of Revenue (FBR) has formally launched a complaint that PSIDs generated by WeBOC system for payment of customs duty and other taxes especially the levy on Mobile devices are not being entertained, by the bank branches.

In view of the above, all banks were advised vide email dated 15th March 2019 to improve their customer services in facilitating taxpayers with due courtesy.

Despite the above-referred instructions, there is no visible improvement, as complaints from different quarters are still landing with us.

It is therefore advised to share these instructions with all your branches across the country with the advice to ensure meticulous compliance and facilitate the taxpayers in payment of taxes and duties under the I Link’s OTC facility.

The branches shall also prominently display on their respective Notice Boards that “Taxes and Duties are accepted here under the 1Link’s OTC facility”. Further, banks shall also ensure that the branch staff has adequate understanding of the mechanism for collection of taxes and duties under the said facility.

The banks shall inform this department within 3 working days of the date of circular i.e. 27th March 2019 that these instructions have been communicated to all their branches for meticulous compliance and that the Notice Boards of branches are prominently displaying the message that “Taxes and Duties are accepted here under the 1Link’s OTC facility”.

March 23, 2019
Maintaining five-year record of international trade mandatory under Customs Act

KARACHI: Importers, exporters and other stakeholders related to international trade are required to maintain transactions record for at least past five years.

According to Customs Act, 1969 the stakeholders of international trade are required to maintain record under the following section:

Section 211: Maintenance of record

Sub-Section (1): All importers, exporters and claimants of duty drawback, refunds or any notified concessions, terminal operators, owners of the warehouses, customs agents and the licensed customs bonded carriers, transport operators and tracking companies, carrying out business under this Act or rules made thereunder or under any other law, directly or indirectly, relating to international trade, shall be required to maintain and keep records and correspondence concerning import, export and transit trade transactions.

Sub-Section (2) The records required under sub-section (1) shall be kept for a period not less than five years in such form as the Board may by notification in the official gazette, specify.

Sub-Section (3): The provision of sub-section (1) shall not be applicable to the baggage of the passengers and crew of the conveyance and to the recipients of gifts.
(more…)

March 22, 2019
PTBA demands for judicial policy compliance

KARACHI: Pakistan Tax Bar Association (PTBA) on Thursday demanded the government of recruiting accountant members of tribunals of Customs and Inland Revenue should be through Federal Public Service Commission (FPSC) and approved by Supreme Court / High Court.

The PTBA has sent communication to Dr. Farough Naseem, Federal Minister of Law & Justice, Asad Umar, Minister for Finance, Revenue and Economic Affairs and Muhammad Hammad Azhar, Minister of State for Revenue in this regard.

The tax bar said that the appellate mechanism under tax codes provides right to appeal before the commissioner of appeals or collector of appeals in case a taxpayer is aggrieved by the assessment made by adjudicating officer.

The tax bar said that appellate tribunal is second legal forum for taxpayers or tax department after commissioner Appeals/Collector Appeals.

The Appellate Tribunal Inland Revenue (ATIR) functions through its benches comprising judicial and accountant members. The qualification for appointment as judicial member is similar to that for the appointment of a high court judge, and only well experienced and competent people from the legal profession and judiciary are selected.

“Section 1340(4) of the Income Tax Ordinance, 2001 provides that the accountant member shall be either grade 21 officer of inland revenue or a commissioner having at least three year’s experience or a chartered accountant with 10 year’s experience or a cost and management accountant with at least 10 year’s experience.”

Unless the position of accountant members are advertised through FPSC, how can a chartered accountant or a cost and management accountant ever be selected on merits as accountant member of the tribunal, the tax bar asked.

It further said that at present officers of Inland Revenue are sent to tribunal on secondment. A person having lien with FBR cannot perform the functions independently and further it will be violative of National Judicial Policy 2009.

To make tribunal a truly independent judicial forum, it is imperative to recruit accountant members be it from FBR cadre or chartered accountants and cost and management accountant through FPSC. Accountant member should be appointed through FPSC and as per Judicial Policy 2009.

March 21, 2019
SRB suspends registration of ZY & Co. Bulk Terminals

KARACHI: Sindh Revenue Board (SRB) has suspended the sales tax registration of M/s. Z.Y. & Co. Bulk Terminals (Private) Limited for defaulting payment and e-filing of monthly sales tax returns.

The SRB said that the scrutiny of tax profile revealed that the company failed:

— To make payment of Sindh sales tax on services pertaining to the tax period from December 2018 to February 2019.

— to e-file the Sindh sales tax return in the time limitation and the manner for the aforesaid period.

The SRB said that non-payment of SST and non-filing of SST returns within the time and manner prescribed under the law is contravention of Sindh Sales Tax Act, 2011 and the rules made thereunder.

The SRB suspended the sales tax registration of the company with immediate effect. However, it directed the company that the suspension would be revoked if following remedial measures are taken:

— To discharge all sales tax liability

— To e-file the true and correct monthly Sindh sales tax returns for the said tax periods.

In case of non-satisfactory response or failure to take remedial measures as suggested on or before April 04, 2019, the case would be further proceeded for cancellation the registration with the SRB.

March 21, 2019
SRB suspends registration of ZY & Co. Bulk Terminals

KARACHI: Sindh Revenue Board (SRB) has suspended the sales tax registration of M/s. Z.Y. & Co. Bulk Terminals (Private) Limited for defaulting payment and e-filing of monthly sales tax returns.

The SRB said that the scrutiny of tax profile revealed that the company failed:

— To make payment of Sindh sales tax on services pertaining to the tax period from December 2018 to February 2019.

— to e-file the Sindh sales tax return in the time limitation and the manner for the aforesaid period.

The SRB said that non-payment of SST and non-filing of SST returns within the time and manner prescribed under the law is contravention of Sindh Sales Tax Act, 2011 and the rules made thereunder.

The SRB suspended the sales tax registration of the company with immediate effect. However, it directed the company that the suspension would be revoked if following remedial measures are taken:

— To discharge all sales tax liability

— To e-file the true and correct monthly Sindh sales tax returns for the said tax periods.

In case of non-satisfactory response or failure to take remedial measures as suggested on or before April 04, 2019, the case would be further proceeded for cancellation the registration with the SRB.

March 21, 2019
Option of refund through bonds can be availed by March 25: FBR

ISLAMABAD: Federal Board of Revenue (FBR) has asked sales tax refund claimants to avail option of bonds by March 25, 2019.

“Those who wish to be included in the first phase of bond issuance may furnish their options by March 25, 2019,” the FBR said in a notice on Thursday.

The FBR said that in order to facilitate exporters and other businesses, it has been decided to issue them sales tax refund bonds in the Sales Tax Act, 1990 for this purpose:

The bonds shall be tradeable, SLR eligible and shall act as collateral for getting bank loans.

The bonds also carry simple profit of 10 percent per annum over three-year maturity period.

The FBR said that those claimants willing to get refund payment through bonds may furnish their options.

March 21, 2019
FBR notifies promotion of IR officers to BS-16

ISLAMABAD: Federal Board of Revenue (FBR) on Thursday notified promotions of steno-typists and supervisors/head clerks of Inland Revenue Department to BS-16 with immediate effect.

Through a notification following steno-typists have been promoted as assistant private secretary (BS-16) on regular basis with immediate effect:

01. Alamgir Khan, RTO Peshawar

02. Sirajuddin, RTO Peshawar

03. Zaheer Iqbal, RTO Rawalpindi (He will actualize promotion with effect from April 14 on retirement of Javaid Mukhtar, APS (BS-16), RTO Rawalpindi.

04. Khalid Mehmood, RTO Gujranwala

05. Muhammad Khalid, RTO Gujranwala

Through another notification, the following supervisors/head clerks of Inland Revenue Department have been promoted to the post of Office Superintend Inland Revenue (BS-16) with immediate effect:

01. Muhammad Ramazan, Supervisor, RTO Islamabad

02. Noor Zaman, Supervisor, RTO Peshawar

03. Muhammad Mukhtiar, head clerk, RTO Peshawar

04. Muhammad Younis, Supervisor, RTO Sahiwal

05. Muhammad Mushtaq, Supervisor, RTO Sahiwal

The FBR said that promotion would take effect subject to the condition that no disciplinary proceedings are pending against them.

March 21, 2019
Income Tax Ordinance 2001: return filers can claim tax adjustment paid on educational fee

KARACHI: Income tax return filers can claim adjustment of advance tax paid on educational fee.

According to updated Income Tax Ordinance, 2001 issued by Federal Board of Revenue (FBR) the advance tax collected on education fee under Section 236I is adjustable against total income tax liability of a taxpayer.

Section 236I: Collection of advance tax by educational institutions

Sub-Section (1): There shall be collected advance tax at the rate specified in Division XVI of Part-IV of the First Schedule on the amount of fee paid to an educational institution.

The rate of collection of tax under section 236I shall be 5 percent of the amount of fee.

Sub-Section (2): The person preparing fee voucher or challan shall charge advance tax under sub-section (1) in the manner the fee is charged.

Sub-Section (3): Advance tax under this section shall not be collected from a person on an amount which is paid by way of scholarship or where annual fee does not exceed two hundred thousand rupees.

Sub-Section (4): The term “fee” includes, tuition fee and all charges received by the educational institution, by whatever name called, excluding the amount which is refundable.

Sub-Section (5): Tax collected under this section shall be adjustable against the tax liability of either of the parents or guardian making payment of the fee.

Sub-Section (6): Advance tax under this section shall not be collected from a person who is a non-resident and,—

(i) furnishes copy of passport as an evidence to the educational institution that during previous tax year, his stay in Pakistan was less than one hundred eighty-three days;

(ii) furnishes a certificate that he has no Pakistan-source income; and
(iii) the fee is remitted directly from abroad through normal banking channels to the bank account of the educational institution.

March 21, 2019

Group	Amount of tax (per annum)
Group or Class A:	Rs. 10,000
Group or Class B:	Rs. 7,500
Group or Class C:	Rs. 5,000
Any other category:	Rs. 5,000